SR&ED claims by Medical Professional Corporations

During the past 4 years the medical profession has faced new challenges relating to claims for SR&ED tax credits.

Summary of key issues from 2017 – unresolved in 2019

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Medical Issues in SR&ED

1. Alternate Payment Plan (APP)/Alternate Funding Plan (AFP) as Government Assistance for SR&ED	Key issues	Analysis & Recommendations

	a. AFP Funding Mechanism Overview
		i. History
		ii. Types of APP/AFP in relation to SR&ED
	b. CRAs Recent Positions on APP/AFP
		i. Examples of CRA recent statements for claims in Ontario and Quebec
	c. Counterarguments
		i. Contract analysis ? Obligations of Medical Professional Corporation (MPC)
		ii. Lack of Linkage = AFP is NOT with respect to SR&ED
		iii. Reasonable Allocation Based on FTE Ratio Related to SR&ED

2. R&D by Doctors is a Fulfilment of Obligations Under Their Appointments = NO SR&ED for MPCs

	a. Elaboration on recent positions taken by CRA: Work is not performed by or on behalf of MPC
		i. Analysis of obligations under appointment letters
		ii. Obligations as employee of MPC
		iii. Direction of R&D work
		iv. Right to Perform R&D
		v. Publication of Results
	b. Counterarguments
		i. MPCs with non?appointed employees performing R&D activities (i.e. fellows)
		ii. Pooling of Funds under Corporate Entity to Create Protected Research Time
		iii. Right to Exploit Results
		iv. Explicit Agreement with Hospital/Academic Health Science Centre

3. Other structural options for Medical Research SR&ED Claims	a. Formation of Designated Research Institute	i. need for communication

4. Current Status of National CRA Policy?	a. No policy	i. request direction

5. Strategies for Handling Denials:	a. Accelerate Cases to TCC	i. costs
		ii. time of response